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Penggui Yan, the chair of HD Mining International Ltd., seen here at the firm’s offices in Vancouver on February 4, 2013.Rafal Gerszak/The Globe and Mail

The Federal Court of Canada has dismissed a challenge by two unions over a Vancouver-based company's hiring of 201 temporary foreign workers from China for a coal project in northern British Columbia.

Local 115 of the International Union of Operating Engineers and Local 1611 of the Construction and Specialized Workers' Union applied last fall for the judicial review of the positive labour market opinions (LMO) that allowed HD Mining International Ltd. to hire the temporary foreign workers (TFWs) for its Murray River coal mine near Tumbler Ridge.

The unions had argued there were qualified Canadian applicants, with extensive mining experience, for the positions. As well, they claimed an officer with Human Resources and Skills Development Canada – which administers the temporary foreign worker program – was being unreasonable when he concluded that hiring the TFWs would likely have "a neutral or positive effect" on the labour market. His decision might have been fettered by superiors who wanted positive LMOs, the unions argued.

In the end, Justice Russel Zinn found there was nothing to support the unions' claims.

Brian Cochrane, a spokesman for IUOE Local 115, said he was disappointed in the decision but felt the action was worth it. "We've had a chance now to get the public awareness up, the problems and the flaws of the temporary foreign workers program," he said. "I would say that, up until six months ago, most Canadians were probably not aware of the fact we've got over 300,000 temporary foreign workers in the country."

HD Mining chairman Penggui Yan called the decision a "complete vindication" for his company, but said it came "at a great cost and raised significant questions in the international investment community."

"During these months of litigation, the unions made many allegations – both in court and the media – which we frankly found appalling," he said in a statement issued Tuesday. "We knew this litigation was driven by a political agenda and we knew we needed to wait for a Canadian court to reject these claims. It has taken a long time, but today is that day."

In late April, on the heels of public outcry over Royal Bank of Canada replacing a small group of Canadian staff with temporary foreign workers, Ottawa announced several measures intended to close loopholes in the program. They included temporarily suspending the accelerated labour market opinion process, which allowed approved employers to bring in foreign workers faster, and removing an option that allowed employers to pay foreign workers up to 15 per cent less than the average comparable wage in the region.

"Without this case, we would not have seen a single improvement to the temporary foreign worker program," Mr. Cochrane said. "I think we're going to have to be continually monitoring how effective these new changes are and continue lobbying and talking to folks from the federal government to make sure this program does what it's supposed to do, which is to allow specialized workers to perform work within the country when Canadian workers aren't available."

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